Activision
and
Vivendi
have signed a definitive agreement which will create the world's largest
independent video game publisher.
Under the terms of the agreement, Vivendi Games will be merged with a wholly
owned subsidiary of Activision in a deal valued at nearly $19bn.
The new company,
Activision
Blizzard, will hold the rights to some of the most well known video game
franchises, including Guitar Hero, Call of Duty, Tony
Hawk, Sypro, Warcraft, StarCraft and
Diablo.
Activision Blizzard expects to generate approximately 70 per cent of its
revenues from these franchises.
"Blizzard's industry-leading PC games business is an exceptional fit for
Activision's highly profitable console games business," said Mike Morhaime,
president and chief executive at Blizzard.
"We have much in common in terms of our approaches to game development and
publishing, and we look forward to creating great games for Blizzard gamers
around the world."
Shares of Vivendi Games will be converted into new shares of Activision
common stock. Activision shareholders will receive $27.50 a share, a premium of
31 per cent on Activision's average closing price over the past 20 trading days.
Vivendi Games will then buy a 52 per cent stake in Activision for $1.7bn in
cash.
Activision Blizzard expects the business combination to give it the most
diversified and broadest portfolio of interactive entertainment assets in its
industry, allowing it to capitalise on the worldwide growth in interactive
entertainment.
"This is an outstanding transaction for Activision and our stockholders, as
well as a pivotal event in the continuing transformation of the interactive
entertainment industry," said Robert Kotick, chairman and chief executive of
Activision.
"Activision Blizzard will be the only publisher with leading market positions
across all categories in the rapidly growing interactive entertainment software
industry."
Kotick added that the deal will automatically generate a relationship between
Activision Blizzard and
Universal
Music Group, the world's largest music company, giving it another foothold
in popular music titles such as Guitar Hero.
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